February 28, 2024
Bill Report

With 8 days left in the 2004 legislative session, the bulk of the action between now and adjournment will be on enacting supplemental budgets, addressing the Initiatives to the Legislature that were filed and certified, and finishing up a modest number of policy bills. 

House and Senate Release and Pass Budget Proposals

On February 18, the Senate released its Operating budget proposal: Senate Operating Proposals (wa.gov). Overall, the Senate budget increases spending by $1.9 billion in the current biennium and would bring total spending in the 2023-25 biennium to $71.66 billion (an increase of 11.7% over 2021-23 spending). The Senate passed the budget on February 23 with a bipartisan vote of 45-4.

The next day, the House released its Operating budget proposal: House Operating Proposals (wa.gov). Overall, the House budget increases spending by roughly $2.2 billion in the current biennium and would bring total spending in 2023-25 to $72.00 billion (an increase of 12.3% over 2021-23 spending). The House passed their budget on February 24 with a vote along party lines of 58-37.

To put that spending in perspective, just 10 years ago, the biennial operating budget was less than half what is now proposed, at $33.65 billion. 

With each body having passed its version of the budget, budget negotiators will work towards reconciling and passing a final supplemental operating budget. Although the two proposals are some $300 million apart, the differences are expected to be ironed out in time for an on-time adjournment.

Initiatives to the Legislature

Hearings are being held this week on three of the six Initiatives to the Legislature that have been certified by the Secretary of State's Office. 

Those three are:

• Reasonable police pursuit (I-2113)
• Clarifying prohibition on state/local income tax (I-2111)
• Establishing the parental bill of rights in public education (I-2081)

The conventional wisdom is that legislative leaders want to accept these measures to keep them off the November ballot. That would leave the other three initiatives (eliminating the capital gains tax, rescinding the Climate Commitment Act cap and trade program, and making the state's long-term care payroll tax an optional, opt-in program) to go before voters this fall.

Policy Bills:

WBA is generally comfortable with where we stand on policy bills this session. Those that were most problematic have failed to progress. There are a couple of bills that are alive and worth noting: 

• SB 5838, the Senate proposal to create an artificial intelligence task force to examine regulatory oversight of this rapidly evolving technology, continues to move forward in the House, having passed the Appropriations Committee. The House has amended the Senate version, but the changes were less significant than many expected, which increases the likelihood that the differences can be resolved by final passage by both chambers.
• HB 1915 is WBA-supported legislation that would expand state financial literacy programs and requirements for high school graduation. It passed the House unanimously and has passed the Senate Education Committee. It is now in Rules, the last step before heading to the Senate floor, and could be called to the floor this week.
• SB 5801 deals with the regulation of special deposits. We are comfortable with the clarifications in the bill. It has passed the Senate with a decisive 47 votes and was voted out of the House Consumer Protection and Business Committee. It is now in the Rules Committee. 
• HB 2276, this year'sstate's Real Estate Excise Tax bill, would have created a new category at a higher rate for homes over $3.025 million. While it has been part of the conversation throughout the session, the bill didn't receive its first hearing until February 23, when it passed out of the Finance Committee. The bill could be considered necessary to implement the budget because it deals with fiscal matters and is therefore not subject to cutoffs. However, it was not included in the House or Senate budget and appears to be done for the year.
• HB 1893 would provide unemployment benefits to striking workers. The bill, which passed the House on February 12, 53-44, moved out of the policy committee in the Senate on February 20, just before the cutoff. While not directly a banking issue, it does impact the business community as a whole, as the proposal would raise the cost of unemployment insurance for every company in the state. AWB actively opposes the bill and has an action alert if you want to send your Senator a note.
• HB 2114 deals with rent control and would limit the rental increases to 7% per year. An earlier version of the Senate companion bill failed to advance, but the House bill passed that chamber on a tight 54-43 vote. It was heard in the Senate Ways and Means Committee last week and failed to advance out of the Committee, killing the bill for the year. 

The finish line is in sight. However, we will continue monitoring legislative developments in the session's final days and continue our updates until the sine-die adjournment. As always, if you have any questions or your bank is concerned about an issue not mentioned here, please get in touch with us. 

Thanks for all you do to support your organizations and communities.